THE COMING COMMODITY SUPER-SHOCK: GOLD UP, COPPER DOWN

In this video, Simon Hunt explains why the current geopolitical escalation in the Middle East could ultimately trigger the next major move in commodities — particularly copper. While headlines focus on the military confrontation between Israel and Iran, Hunt argues that the real market story lies in how governments and central banks respond when geopolitical stress begins to threaten financial stability.

History shows that when global tensions intensify and financial systems come under pressure, policymakers often respond with massive liquidity injections. When liquidity floods the system while the U.S. dollar weakens, real assets — especially base metals like copper — tend to rise sharply.

The current tensions between Israel and Iran are not isolated events. They sit within a broader geopolitical landscape stretching across Syria, Iraq, the Gulf states and beyond. The presence of multiple Western military bases across the region means any escalation has the potential to draw in major powers and amplify the scale of the crisis.

As geopolitical risks increase, markets begin to price in uncertainty — not just in energy markets but across currencies, commodities and financial assets.

Recent strikes and counterstrikes between Israel and Iran demonstrate how rapidly the confrontation has widened. Military targets, strategic infrastructure and politically significant sites have reportedly been involved. Developments like these increase the possibility that the conflict could expand further, affecting trade routes, energy supply chains and regional stability.

Within Iran itself, a number of sensitive locations have reportedly been targeted, including facilities connected to military operations and government institutions. Such actions significantly increase the risk of retaliation and escalation, creating a climate of uncertainty that financial markets historically struggle to price effectively.

Strikes affecting multiple regions across Iran suggest the conflict is not confined to a single location. Industrial centers, military installations and strategic cities have all appeared in reports of activity. When events spread across such a wide geographic footprint, the probability of disruptions to global energy markets and broader financial systems rises significantly.

Beyond military developments, the political and sectarian dynamics of the Middle East also play an important role. Shia populations across Iran, Iraq, Lebanon, Bahrain and parts of the Gulf add further geopolitical complexity that can influence alliances, regional stability and the potential spread of conflict.

According to Simon Hunt, however, the deeper economic story lies in what happens next within the financial system. Historically, when geopolitical shocks escalate into broader economic stress, central banks respond with significant liquidity injections. The U.S. Federal Reserve, together with the U.S. Treasury and other G7 policymakers, has repeatedly acted to stabilize markets during periods of crisis by flooding the financial system with liquidity.

If a similar response occurs again, the consequence could be a substantial weakening of the U.S. dollar. A falling dollar combined with rising inflation expectations historically drives investors toward real assets and commodities. Financial institutions seek protection against currency depreciation, while manufacturing industries increase their demand for key industrial metals.

Copper sits at the center of this dynamic. Prices could decline in the near term — potentially falling from the 12,000 level to significantly lower. However, once liquidity floods the system again, the longer-term effect could set the stage for a powerful rebound.

From the eventual lows, copper prices could more than double.

The reason is that not only will financial institutions be seeking hedges against rising inflation and a falling dollar, but manufacturing industries will be doing the same. Historically, when both financial capital and industrial demand converge, copper has experienced some of its sharpest price increases.

Periods of financial stress trigger policy intervention. Policy intervention increases liquidity and weakens currencies. And that combination has repeatedly preceded powerful rallies in commodities.

In Simon Hunt’s view, the current geopolitical tensions may therefore represent the early stage of a much larger economic cycle. Markets may first experience volatility and declines, but the policy response that follows could ultimately create the conditions for the next major copper supercycle.

Thank you very much for listening.

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